The Government has approved a decree which equates the validity of the modifications introduced to the wealth tax with that of the temporary solidarity tax on large fortunes collected by the State, according to a press release following the Consell Executiu this Tuesday .
In December 2022 The Catalan government has approved by decree-law the temporary increase in the wealth tax in Catalonia to align it with the new state rate for large fortunes and prevent the state from capturing revenues from the region’s highest earners. It then incorporated a final liquidable base tranche for an asset of 20 million euros, which was to be recognized at the rate of 3.48%.
These changes were valid for two years, linked to the existence of the new state tax. With the new decree, these technical modifications are maintained and continue to link their validity to that of the Spanish tax on large fortunes.
In this way, they allow the collection of this tax to remain in Catalonia “instead of going to the Spanish Treasury”, then explained the Regional Executive, who emphasized that if these technical modifications were not made, the Generalitat of Catalonia could lose revenue to the state.
The temporary solidarity tax on large fortunes was created “with the aim of moving towards a more equitable distribution of the economic effects derived from the war in Ukraine so that the country’s major assets, those exceeding 3 million euros, contribute more to society. The fact is that this tax is complementary to the wealth tax, which the Autonomous Communities pay in full. Thus, the amount paid under the Wealth Tax is deducted from the royalty due under the Solidarity Tax on Large Fortunes. This avoids paying taxes twice for the same assets and the same concept. And, at the same time, the new tax guarantees that all great wealth will contribute to the maintenance of the welfare state.
The tax rate is 1.7% for assets between 3 and 5 million euros; 2.1% for assets between 5 million and 10 million; and 3.5% for assets above 10 million euros. With the aim of preventing the State from capturing the income of the highest incomes in the region, what Catalonia did in 2022, and which it approves today, was to incorporate a final basic tranche liquidable for assets of 20 million euros, which was recorded with a rate of 3.48%.
